Obama & Facebook - What's the Buzz?

As a general marketer, I have the sense we will be learning a lot from political marketers this year about how to use social media to influence brands. Social media played a key role in several of the 2006 midterm elections. (See Millennial Makeover for an interesting description of the early use of newsfeeds and groups in campaigning). Social networks are expected to play an even bigger role in the 2008 Presidential campaign, especially given the importance of the Millennial vote to the election outcome. Will social media be just another channel, like radio or TV? Or will its interactivity transform the dialog into something never seen before?

As a first step to nabbing an invitation to the 'netroots' marketing party, I set out to see what Obama is doing with Facebook. I checked out his profile, joined a group and downloaded the Barack Obama Facebook app.

Obama's profile shows 992,564 'supporters'. Reading the profile and seeing photos of his 'supporters' isn't that involving, as I am sure he doesn't update it himself.

There are many Obama specialty groups, such as 'Notre Dame Students for Barack Obama'. The biggest group, 'Barack Obama (One Million Strong for Obama)', has 564M members. This seems like a lot of members, as the largest corporate sponsored group,'Apple Students' has just 432M members, more than even the PINK Victoria's Secret group's 348M members. However, it pales when compared to the group, '1,000,000 Strong for Stephen Colbert', which really is one million strong with 1,249M members.

The Obama group site at first glance is more like a portal than an interactive experience, displaying links to events, videos, t-shirts, the official donation site, sites explaining Obama's stand on issues, etc. While useful to have aggregated in one place, they aren't anything I couldn't have found with a Google search. More interesting were the 32,322 discussion threads. Tonight's rally in Detroit appears to have many posts, the excitement the difficulty of getting tickets, the prospects of actually posting a video. Before we leave the group, I should note that there seem to be nearly as many anti-Obama groups as there are pro-Obama groups. Stop Barack Obama (One million strong and growing), has 65M members.

Meanwhile, the Obama Facebook app makes content more accessible than the group. Recent videos, news articles, speeches are rated in terms of number of member reader 'thumbs ups'. There are also links to other users’ via the Facebook network and the ability to leave a comment, blogger-style. The content can all be sorted by recency, popularity, and friend's favorites. There are clear links for donating, volunteering and getting involved. This feels more user friendly than the groups.

How these applications, groups and profiles influence the campaign remains to be seen. I plan to keep an eye on things.

Millennials vs. Boomers: Hogwarts as Metaphor?

I highly recommend Millennial Makeover by Winograd and Hais (Rutgers Press, 2008). While the focus is political, there is plenty of useful data for marketers, much of it from familiar sources like Pew (see previous blog post). My reason for recommending it, however, is their use of the data to address the question, 'Are Millennials just younger versions of previous generations or are they really different'? The arguments they put forth are compelling. According to the authors

"... media moguls, authors and even politicians make the fundamental error of thinking that today's young people think and act just like they did when they were young. Nothing could be further from the truth."

They ask us to think of Millennials as a generational cohort made up solely of Harry Potter and his plucky friends, and to contrast them with the adults at Hogwarts, the scowling, often clueless faculty and ministry of magic administrators. While Harry and his team (key word) work hard to save the world, applying special ingenuity and talents, the grown ups they must contend with are "individualistic, judgmental egotists who talk more than they act."

Millennial professionals who participated in two online focus groups, to our surprise, expressed a similar view of Boomers. When asked who they prefer to work with, all said they preferred to work with other Millennials (no surprise there), and they MUCH prefer to work for Gen X'ers over Boomers. This was indeed a big surprise to us, after all that has been written about the supposed natural affinity between Millennials and Boomers. Boomers are considered to be like their parents, pretty old fashioned and out of touch. One young brand manager at Unilever even shared with us that there is a 'reverse mentoring' program in place at his company, where Millennials share their technology wizardry insights with older, less adept Boomers. In contrast, they feel as if they have more to learn from Gen X'ers and that X'ers are more willing to take the time to teach them what they need to know.

Winograd and Hais would find this no surprise, contending that indeed X'ers and M'ers have more in common with each other than they do with the 'idealist' Boomers who bear responsibility for years of political gridlock and ultimately pointless culture wars.

Are Millennials Really Less Cynical?

According to a 2007 Pew Research report, Millennials are markedly less cynical than older generations -- at least as far as putting faith in government and business institutions. A full 82% of 18-29 year olds agree with the statement, "the strength of this country is mostly based on the success of American business". Agreement with this statement among Millennials actually increased 5 percentage points over the past four years. In contrast, agreement among other age groups is much lower and has decreased. The gap is even more pronounced when it comes to perception of government. Just 42% of people under 30 agree with the statement, "When something is run by the government, it is usually inefficient and wasteful", compared to 62% overall (see chart).

These statistics are not that surprising, and help explain the success of Obama's 'change' message among Millennials. They do believe that all of us can do better, that government can be the solution not the problem and that business is a place to make a difference in the world. The College Board has been tracking the most popular majors for over 30 years. While the popularity of business as a major has declined from its eighties peak, it is still the most popular major, beating the runner ups of health, biology, engineering and education by a wide margin.

The paradox here is that Millennials are entirely cynical and suspicious when it comes to marketing. My marketing students at University of Notre Dame uniformly believe that advertisers lie, that there is a catch to every offer and are willing to believe the worst customer service and product horror stories. Last November, I published an article in Ad Age entitled, "Clued in or Clueless, What Marketing Students don't know about Marketing." I asserted that students routinely dismiss claims made in advertisements, without considering that it might be illegal or that there are natural checks and balances against lying in ads. The response from Millennials was denial. Here's a sampleof what Millennials had to say:

They also know that ads aren't allowed to lie, but they do know that lying ads and false claims slip by and have to be brought to court to be disputed or distort the truth just enough to be factually accurate yet coming off with a different claim. This is why they're skeptical. They don't put much stock in enforcement and compliance, while well aware of the laws.

So my quesiton is, if Millennials are truly are less cynical, why doesn't their lack of cynicism extend to marketing messages?

Millennial Politics: Generational or Age-Related?

Is there anyone in the U.S. that hasn't heard that Millennials are shaping the 2008 election? Books, magazines and blogs are abuzz with the news that 2008 is going to be the year of the Democrats due to the liberal attitudes of younger voters, many of whom are voting for the first time. According to Pew Research's analysis of Super Tuesday voters, 58% self identify themselves as "liberal" in their political orientation. 57% voted for Obama, 41% for Clinton. The more interesting question is whether this is any different than in past elections? Are today's younger people actually more liberal than earlier generations? A quick glance at the chart indicates that he answer is 'yes' (don't you love it when that happens?). According to a 2007 Pew Study, each generation tends to be less socially conservative than the generation before it. Generation Y is not only less socially conservative than older cohorts, they are less socially conservative than those cohorts were at a similar age. Social conservatism is measured by agreement with 6 statements. Gen Y on average agrees with only 2.5 of the statements, while twenty years ago, Boomers agreed with more than 3 (see chart). However, the biggest gap, now and then, is between Boomers and the Pre-Boomer generation, not between Boomers and Gen Y. So the more correct answer is that Gen Y liberalism is actually both generational and age related.

Millennials: A Melted Pot

Is 'Multicultural Youth Marketing' a redundancy? 38% of 18-24 year olds are non-white (see chart below). This generation is famous for its tolerance -- Pew Research reports 94% of the post 1977 born Gen Y approve of interracial dating compared to 84% of Boomers. Just 17% of 18-29 year olds said that race was important to their vote in the primary compared to 22% of 30-44 year olds. 57% voted for Obama vs 48% for all age groups. (Pew Research Center, Young Voters in the 2008 Primaries). Given this kind of evidence, I think there is a case that youth marketing and multicultural marketing are one in the same. Gen M not only desires diversity, they expect it. Recent focus groups we conducted on women and fashion found the appeal of celebrities like Tyra Banks easily cross ethnic boundaries, while Jennifer Anniston is 'every girl' for everyone. No college can afford to not have its multicultural images on display. Perhaps we are stating the obvious, but if so, why are we still talking about 'multicultural marketing'? Perhaps we should just say 'culture aware marketing'?

Changing Spirits of the Times

In an earlier posting, I noted French Millennials are forgoing wine, Mon Dieu! Now Nielsen is reporting U.S. Millennials are forgoing beer in favor of wine. Shocking but true, beer drinking among 21-30 year olds dropped 12 percentage points in the last 10 years. For comparison, over thirty's beer consumption dropped just 6 percentage points. According to Nielsen, most of the 'slack' is being picked up, you guessed it, wine! (Before we get too carried away with this insight, Nielsen also points out that beer still accounts for 83% of Gen Y alcoholic beverage purchases.) Research by Gallup and another study by the industry group, Wine Market Council, confirm the trend. The Boston Globe speculates that "Millennials have the potential to become the next generation to embrace wine in numbers not seen since the baby boomers."
What does this trend tell us about the tastes of U.S. Millennials? A lot, according to qualitative research by Liz Thach, Sonoma State University. First the research revealed that only 18% of Millennial wine drinkers see wine as "hip or cool". Most in fact think it is too 'elite' to be hip or cool and wish that marketers would portray wine drinking as more 'fun'. Instead, the Millennials who drink wine regularly drink it because they like the taste and think it goes well with food. Furthermore, (big hint here), half said that they were introduced to wine through a family member. This suggests Millennials tastes are influenced by their Boomer parents. The Boston Globe put it this way:

Thach's (focus group) respondents seemed to have sophisticated culinary interests. She says they watch cooking and decorating shows, throw dinner parties, and eat interesting, diverse foods. ''They like wine with food," she says. ''This is where I see a trend happening in this country, which also happened in Australia several years ago -- what they call the cafe society. We are starting to be more interested in the good things in life: good wine, good food, friends, taking time out to relax and enjoy things. This is actually one of the values we identified of this generation...The generation who grew up with free-range chickens, organic vegetables, and working moms who stopped for take-out on the way home were exposed to all kinds of food from an early age. Add to that the array of imported foods and beverages available to them -- this demographic moves from Swiss chocolates to Hershey's bars with ease -- and you have one possible explanation as to why the diversity of flavors in wine are appealing to this group.

This insight confirms my earlier assertion that Millennials, with their above average earnings and sophisticated tastes, are an untapped market for what many consider 'luxury' goods. You just can't call them luxuries.

Millennials: The Wealthiest Americans?

I am losing patience with the pronouncements that this is the first generation that expects to be downwardly mobile. The reality is that 18-24 year olds are among the wealthiest people in America. Just don't tell them that, they won't believe it.

According to the Bureau of Labor Statistics, 87.4.3% of 18-24 year old males had wages and salary in 2005. In 2006, households headed by persons 18-24 had earnings before taxes of nearly $29,057, up from just $20,120 in 2003 and up 7.5% 2005-2006 alone. For comparison, U.S. income grew just 1.1% in the same period. What makes these figures even more astonishing is that 18-24 year olds by and large do not have families to support. 43% of 18-24 year olds are college students (National Center for Education Statistics). Less than 10% of 18-24 year old males are married. 50% of 18-24 year men live with their parents, 33% of women live with the parents.

If you think starting salaries are down, you'd be wrong. According to Businessweek (5.19.08), the expected starting salaries of new MBA's exceeds $85K, up steadily every year but one since 2002. Starting salaries offered to undergrad business administration majors increased 7.5% 2006 to 2007. So why the angst? Why do most 18-24 year olds consider themselves poor now and their prospects even poorer?

My personal theory is that Millennials have a different idea of what constitutes a 'necessity' and what constitutes a 'luxury'. My college students consider themselves 'poor', yet nearly all sport ipods with thousands of songs, the latest laptops, expensive footwear, cell phones with $100+ plans. The data bears this out. According to the BLS, 18-24 year olds spend a disproportionate amount of money on virtually every category of spending other than food and housing (see table). Within these categories,they have luxury tastes. For example, Millennials are almost twice as likely as older consumers to purchase imported beers and almost three times as likely to pick up a craft beer.

Marketers are on to this insight, even if the Millennials themselves are not. 18-24 year olds represent a vast market for 'luxury' goods --- we just don't call them luxuries.